May 06, 2022
Happy Friday, Media Deals readers!
🎸 Situational awareness: Live Nation Entertainment reported what it called its "best first quarter ever" with $1.8 billion of revenue, up from $290 million the year prior.
1 big thing: 🎤 Live with NBCU's Linda Yaccarino
Too many media companies with skin in the streaming game fail to realize their competition is with more than just each other, NBCUniversal's Linda Yaccarino told Tim during Axios Pro's live event yesterday.
Why it matters: Netflix's stalled growth is what's largely driving Wall Street's sudden cooling effect on the streaming business.
- Netflix lost customers for the first time in a decade and has since said it would pull back on spending and introduce a cheaper, ad-supported option.
- "So many companies have, in streaming, decided to chase and be Netflix for the last 10 years. That was never the business case at Peacock," says Yaccarino, NBCU's chairman of global advertising and partnerships. "Our hunch about an affordable product with the right amount of commercials married with great content really does prove the point that the Netflix momentum was only going to last so long. And now they have a complex problem on their hands."
The big picture: There's a growing realization around Hollywood that relying purely on subscriber revenue with a "growth at all costs" ethos does not make a long-term business plan.
- Free streaming services like Paramount's PlutoTV and Fox's Tubi have been gaining steam as low- or no-cost alternatives to pricier services. At the same time, HBO Max has introduced a cheaper option with ads, and Disney+ has plans to do the same later this year.
- "When we think about subscription in the macro, I think people in the media industry only look at it as how many streaming services are going to work, and they don't think about the share of wallet. That includes subscriptions for many other things — from news to health to music," Yaccarino said. "In a world that we're unfortunately living in, with inflation and the fear that it might devolve into a recession, free sounds pretty good."
By the numbers: Peacock has 28 million monthly active accounts and 13 million paid subscribers.
- For paying subs, that's an increase of 4 million paying customers during the first quarter of 2022.
- Yaccarino credits Peacock for having both Super Bowl LVI, the Beijing Winter Olympics and its "Fresh Prince" drama reboot "Bel-Air," which has been seen by 8 million accounts — a record in the streaming service's brief tenure.
Yaccarino also touched on the coming upfronts during the roughly 30-minute chat yesterday.
- On upfronts being back in person: "There is no surrogate for that human relationship and experience. It's the business that we're in."
- On measurement: "As the consumer has moved at lightning speed, across platforms across screens, across distribution vehicles, measurement hasn't been able to keep up. That's why we widened our aperture and invited a lot of measurement companies in so we could speak specifically to clients who have many different KPIs."